Being a small business owner, you might face a lot of challenges in running business operations. In fact, you may experience troubles in getting a small business loan as well. It’s difficult to secure small business loans with poor credit, even though it is harder, it is not impossible as there are numerous alternative lenders like Indifi that provide business finance for companies with poor credit history.
Borrowing a small business loan in India with these FinTech lenders is possible as they concentrate on more than your credit report for making a determination. They ponder the strength of your business, your operating history, potential, revenue, and other operational parameters in your business loan application.
This blog is for small businesses with bad credit, which are looking for business finance. There are numerous lending resources which can help small businesses by providing loans in India. Let’s have a discussion on how small business owners can take a business loan!
- Determine your purpose of borrowing loans
Ask yourself why you require a business loan. Lenders will want to know the same and your purpose of borrowing loan may fall into one of these categories mentioned below:
- To launch a new business
- To expand your present business
- To handle daily expenses
- To buy more inventories
- To pay utility bills or salaries of employees
- Decide right loan option for your business
Your purpose of loan requirement will dictate the loan type you receive. If you have just started your business, virtually it’s not possible to receive a loan in the first year of your organization. Lenders need cash flow for supporting loan payback; hence, start-ups are basically instantly disqualified from business financing. For businesses with at least two operational years, you have more business financing options, including unsecured business loan, term loans, business lines of credit, merchant cash advance, equipment financing, etc.
- Choose the right lending institution
You can receive small business loans in India from different online lenders. These lenders provide products incorporating term loans, business lines of credit, merchant cash advance, etc. Once you decide which kind of lending institution is right for you, compare 2 or 3 same options depending on yearly percentage rate and payback terms. Among the business loans you qualify for, select the one with the lowest rate of interest, as long as you are capable of dealing with the regular payments of the loan. Use Indifi’s business EMI calculator to measure your monthly installment.
- Figure out whether you qualify
Your credit score is a factor that decides which business loan you will qualify for. In case your credit score is poor, ponder borrowing small business loans from online lenders like Indifi that offer loans even if you have bad credit. Alongside your credit score, a lender considers your business operational years. This must be at least 2 years to get business loan approval. Maximum online lenders need minimum yearly revenue; so find out yours prior to applying. Check your business financials carefully–particularly cash flow–and measure how much you can afford to pay back every month.
- Collect all documents
After comparing your options, it’s time to fill up the online business loan application! You can apply for many small business loans within a short time span with no negative impact on your personal credit history. Based on the lender, you will require submitting the following documents alongside your business loan application:
- Latest ITR
- Last 6 months’ bank statements
- Financial documents
- Legal documents
Indifi: The Best Option for Taking a Small Business Loan
So, it’s evident that a small business owner can easily borrow a business loan even if it has bad credit. Indifi is the best platform that even offers a small business loan for women at a convenient payback term with lowest interest rates. If you are seeking business financing, it’s time to contact Indifi!
